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     - Winter '04
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The Age Discrimination in Employment Act (ADEA): Illinois Courts Have no Jurisdiction Over Age Discrimination Cases

Melhan v. Illinois Power Co., 347 Ill app 3d 761, 808 N.E. 2d 555, 283 Ill. Dec 589, Ill App. 5 Dist., April 12, 2004

Vacating a million dollar age discrimination jury verdict and dismissing the case with prejudice, The Fifth Circuit Court of Appeals for Illinois recently underscored a key difference which exists between the prosecution of federal and state employment age discrimination claims. While the Plaintiff, Robert Meehan, correctly filed his charge of discrimination under the ADEA with the EEOC and the Illinois Department of Human Rights, when he received a right to sue letter from the EEOC, he filed his ADEA claim in state court in St. Claire County Illinois. The defense argued that Illinois Courts lacked subject matter jurisdiction over age discrimination claims. 

The Appellate Court agreed, ruling that the Illinois Human Rights Act requires that civil rights claims be prosecuted in the administrative forum provided in our state. While the plaintiff could have filed his ADEA claim in federal court, Illinois courts do not have concurrent jurisdiction over such a federal claim based on “a neutral rule of judicial administration.” The Fifth Circuit ruled that Illinois bars all claims of age discrimination from its courts whether based on federal or state law, requiring that they be prosecuted in Illinois’ Administrative forum (the Illinois Human Rights Commission.) 

While federal law (the ADEA) allows age discrimination claims to be prosecuted in federal court, state law (the Illinois Human Rights Act) provides for the entirely administrative adjudication of age discrimination cases.

Despite the language of the ADEA which states that “any person aggrieved may bring a civil action in any court of competent jurisdiction for such legal or equitable relief as will effectuate the purposes of this chapter, 29USC Section 626(c)(1) (2002), the courts of Illinois simply do not have jurisdiction over age discrimination claims and “the United States Constitution does not require a state to give jurisdiction to its courts against its will.” Meehan citing Brown v. Gerdes, 321 US 178 at 189, 64 S. Ct, 487 88L.Ed.659 (1944).

THE AMERICANS WITH DISABILITIES ACT (ADA): Father of Premature Twins Loses His Claim under the American’s with Disabilities Act

Larimer v. International Business Machines Corp No. 370 F. 3d 698, 32 Employee Benefits Case 2678, 15 A.D. Cases 1070, 28 NDLR P106, 7th Cir. (Ill), June 3, 2004

The United States Court of Appeals for the Seventh Circuit reminds us again of the limited remedies available to employees under the Americans with Disabilities Act. Thomas Larimer was a new employee at IBM when his twin daughters were prematurely born at 29 weeks gestation. Two hundred thousand dollars of medical bills later (all paid by IBM) the premature girls were healthy but likely to face physical and mental disabilities in the future. By then, IBM had fired their father. He claimed discrimination under the ADA alleging that he was fired because his daughters were disabled and because of IBM’s annoyance at having to pay high medical bills. 

Rejecting every theory of the Plaintiff, Justices Bauer, Posner and Easterbrook ruled in pertinent part that Mr. Larimer was fired due to poor performance and that because he himself is not disabled, he was not entitled to any right of accommodation based on his daughters’ disabilities. The court found that there was no evidence of “specific intent” by IBM to punish Larimer for asserting his right to payment of the girls’ medical bills under IBM’s ERISA plan. Judge Posner chided the Plaintiff for failing to establish proof of any comparable employee at IBM who had not applied for such large benefits and was treated more favorably.

THE EMPLOYMEE RETIREMENT INCOME SECURITY ACT (ERISA): HMO’s are fiduciaries of defined employee benefit plans and may not be sued for negligence when they deny benefits.

Aetna Health Inc., fka Aetna U.S. Healthcare Inc. and Aetna U.S. Healthcare of North Texas, Inc. v. Juan Davila, 124 S. Ct. 2488, 72 USLW 4516, 32 Employee Benefits Cas 2569, June 21, 2004.

In a controversial decision written by Justice Clarence Thomas, the United States Supreme Court has ruled that HMO’s are fiduciaries under ERISA- regulated defined employee benefit plans. Invoking the expansive preemptive scope of ERISA, the Court found that HMO’s which are accused of refusing to cover medical care requested by physicians may not be sued in tort or under state statutes which regulate insurance and which require insurers to act with ordinary due care when making health care treatment decisions. All such actions are preempted by ERISA and the limited remedies of ERISA apply.

This decision effectively cuts off test cases which have sought to call HMO’s to account for injuries suffered by patients denied various forms of medical care. One of the Plaintiff’s, Julian Davila, was prescribed Vioxx for the treatment of arthritis by his physician. His HMO refused to pay for the Vioxx, so Davilla took Naprosyn and suffered a severe reaction requiring hospitalization. Davilla sued Aetna under the Texas Health Care Liability Act alleging that Aetna’s refusal to cover the requested service violated their duty to exercise ordinary care when making health care treatment decisions “and proximately caused his injuries.”

The Supreme Court ruled that this was purely a suit to rectify a wrongful denial of benefits promised under an ERISA regulated plan and that it fell within the scope of ERISA’s civil enforcement mechanism. That mechanism is the exclusive remedy, and all other alternative remedies are preempted. Citing Pilot Life Insurance Coompany v. Dedeaux 481 US41, 107 S. Ct 1546, the Court noted that the limited remedies available under ERISA are an inherent part of the “careful balancing” between ensuring fair and prompt enforcement of rights under a plan and the encouragement of the creation of such plans. Allowing respondents to proceed with their state lawsuits would “pose an obstacle to the purposes and objectives of Congress.”

New Federal Overtime Rules For “White Collar” Employees

Effective August 23, the U.S. Department of Labor has revised its regulations defining which “white collar” employees are entitled to overtime pay under the Fair Labor Standards Act for working over 40 hours in a week. To be exempt from overtime pay, a professional, administrative or executive employee now must receive a salary of at least $455 per week ($23,660 per year). [The old test required a salary of only $155 per week for the exemption.] The regs also make changes to the duties tests used to determine which salaried workers are exempt from overtime pay.

Just to confuse matters, the State of Illinois has passed a law amending the similar state overtime law to ignore any changes in the federal regulations other than the increase in the minimum weekly salary to $455. The net effect of all this will depend on individual circumstances, but some workers who now will not be entitled to overtime pay under the FLSA will still be entitled to overtime under the Illinois Minimum Wage Law.

Employers Can’t Ask Applicants About Expunged Juvenile Records

Effective January 1, 2005, Illinois employers will be forbidden to consider expunged juvenile criminal records in any employment matters. Employment applications must be changed to include specific language telling applicants that they are not obligated to disclose any expunged juvenile records of arrest or conviction. Employers will be prohibited from asking applicants if they have ever had a juvenile record expunged.

Illinois Strengthens Job Protection For Active Duty Reservists And National Guard Members

The Illinois Service Members’ Employment Tenure Act generally provides that if a returning military service member applies for reinstatement within 90 days of being honorably discharged or of satisfactorily completing service, the employer must restore the serviceman to the position he or she left to perform the military service. The returning employee is entitled to whatever status, seniority and wage increases he or she would have received had he or she not been called away to serve the military.

The returning employee can sue to enforce these rights. Recent amendments to the Employment Tenure Act now add a monetary penalty to “encourage” compliance. A “knowing” violation of the Act is a “business offense” punishable by a fine of between $5,000 and $10,000.

Illinois Continues Campaign To Close Gender Gap In Pay

Since January 1, the Illinois Equal Pay Act has prohibited employers with 4 or more employees from paying unequal wages to men and women for doing “the same or substantially similar work.” Employers are required to post an Equal Pay Act poster. The Governor’s Office is continuing its “Equal Pay Campaign” to publicize this employment right by distributing posters, issuing press releases and doing public service announcements to address the fact that “In Illinois, Women Earn 71¢ For Every $1 A Man Earns.”